Understand the importance of commodities in business (C)
Be able to describe the effect of supply and demand (B)
Starter (10 mins)
Oil Prices vary wildly. The price of oil often determines the price of other goods as we use it for transport/heating etc.
Find the price of oil over the last 12 months...
Find the price of oil over the last 10 years.....
Keywords (10 mins)
Discussion (10 mins)
Changing market prices affect the costs of a business. When the price of commodities rises a business will find that its production or running costs increase. Higher costs are either:
Passed on - the consumer will see rising prices in the goods or services Absorbed - the business absorbs the price rises leaving them lower profit margins
If a company delivering goods for hire (like a bouncy castle company) absorbs the rising price of commodities do you think this will be sustainable?
What commodities would be the ones to affect such a company.
Task (25 mins)
Commodities which affect the majority of small businesses are oil, gas, electricity, coal.
Explain how a sustained price rise in these markets would affect someone running a sandwich shop on Canvey Island. (3 marks)
What other commodity prices would affect them? (4 marks)
When do YOU think the sandwich shop would start putting their prices up and why would they wait until this time? (5 marks)
Make sure you add a header and footers to your document (name - class name)
Print your answers
Plenary (10 mins)
Mark your neighbours answer - reflect on your own answer through theirs.
Extension Task
Gold prices
Find out the gold prices over the last 10 years. How has this benefitted :
The Economic Context
Lesson 1 Lesson 2 Lesson 3 Lesson 4 Lesson 5 End of Unit Test
Lesson Objectives
Starter (10 mins)
Oil Prices vary wildly. The price of oil often determines the price of other goods as we use it for transport/heating etc.Find the price of oil over the last 12 months...
Find the price of oil over the last 10 years.....
Keywords (10 mins)
Discussion (10 mins)
Changing market prices affect the costs of a business. When the price of commodities rises a business will find that its production or running costs increase. Higher costs are either:Passed on - the consumer will see rising prices in the goods or services
Absorbed - the business absorbs the price rises leaving them lower profit margins
If a company delivering goods for hire (like a bouncy castle company) absorbs the rising price of commodities do you think this will be sustainable?
What commodities would be the ones to affect such a company.
Task (25 mins)
Commodities which affect the majority of small businesses are oil, gas, electricity, coal.
Plenary (10 mins)
Mark your neighbours answer - reflect on your own answer through theirs.
Extension Task
Gold pricesFind out the gold prices over the last 10 years. How has this benefitted :